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Interest waiver scheme likely for KSFC loans

Interest component to be waived for loans up to Rs. 10 lakh, if principal amount is paid

BANGALORE: Chief Minister B.S. Yeddyurappa on Thursday announced that the State Government was planning to announce a scheme under which the interest component would be waived for those who have taken loans up to Rs. 10 lakh from the Karnataka State Finance Corporation (KSFC), if they pay the entire principal amount.

Replying to Congress member Mir Aziz Ahmed during the Question Hour in the Legislative Council, the Chief Minister said a formal notification in this regard would be issued soon.

Non-developmental expenses

The non-developmental expenses of the State had increased to 32.53 per cent of the Consolidated Fund in 2008-09, as against the previous year’s level of 28.95 per cent.

Replying to Janata Dal (Secular) member H.C. Neeravari, the Chief Minister said the non-developmental expenses had touched Rs. 17,638.88 crore in 2008-09.

These expenses had stood at 13,926.45 crore (28.95 per cent) in 2007-08, 13,899.82 crore (31.53 per cent) in 2006-07, 11,990.24 crore (34.28 per cent) and 14,742 crore (41.29 per cent) in 2004-05.

Arrears

He said the increase in non-developmental expenses was mainly due to the pay revision of government employees which resulted in the State Government providing Rs. 1,500 crore towards pay arrears, pension arrears of Rs. 300 crore and an additional allocation of Rs. 600 crore for maintenance of local bodies.

This fiscal

Mr. Yeddyurappa said the government had decided to reduce the non-development expenses to 30 per cent this fiscal.